Wednesday, January 23, 2008

From hyperpower to wounded giant

U.S. in role of wounded giant at Davos by Mark Landler

George Soros is on board with me - to an extent - that there is a silver lining for the world in the current mess our capitalist economy has gotten itself into. It'll finally dethrone the dollar as the world's reserve currency. (And with each rate cut, we get one or two steps closer.) "George Soros, the financier who made a fortune betting against the pound, went so far Wednesday as to say that the downturn would put an end to the long status of the dollar as the world's default currency.

'The current crisis is not only the bust that follows the housing boom,' Soros said. 'It's basically the end of a 60-year period of continuing credit expansion based on the dollar a
s the reserve currency.'"
This means that the U.S. will no longer be the only country in the world that can print its currency as needed for government spending (dominated, of course, by military expenditures) virtually without consequence. With the dollar dethroned, spending more on weapons than the rest of the world combined will no longer be an option. Bye bye military bases in over 150 countries; and bye bye our yearly military Keynesian stimulus package of $500 billion. Good god, the U.S. government may have to start taxing the rich at European levels!

In other words, international finance capital (on top, as usual) has done to the country that has been the world capitol of capital for sixty years, what all the peace groups and identity politics activists (on the bottom) have been resolutely failing at during the same period: put an end to U.S. militarism.

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